Time-resolved single molecule fluorescence measurements may be used to probe the conformational dynamics of biological macromolecules. The best time resolution in such techniques will only be achieved by measuring the arrival times of individual photons at the detector. A general approach to the estimation of molecular parameters based on individual photon arrival times is presented. The amount of information present in a data set is quantified by the Fisher information, thereby providing a guide to deriving the basic equations relating measurement uncertainties and time resolution. Based on these information-theoretical considerations, a data analysis algorithm is presented that details the optimal analysis of single-molecule data. This method natively accounts and corrects for background photons and cross talk, and can scale to an arbitrary number of channels. By construction, and with corroboration from computer simulations, we show that this algorithm reaches the theoretical limit, extracting the maximal information out of the data. The bias inherent in the algorithm is considered and its implications for experimental design are discussed. The ideas underlying this approach are general and are expected to be applicable to any information-limited measurement.
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